Evolutionary game analysis between regional governments and shipping companies: Considering the impact of government subsidy on shipping companies.

ABSTRACT

Maritime agencies are imposing stricter limits on fuel sulfur content, and regional governments are encouraging the reduction of various emissions through subsidies. In this study, an evolutionary game model is constructed to analyze the interaction between regional governments and shipping companies under the fixed and dynamic subsidies. The sensitivity analysis reveals the effect of parameters on stabilization strategies. The results show that the bilateral stakeholders can adopt stabilization strategies under dynamic subsidies. The fines, maximum subsidies and extra cost paid by regional governments have a significant impact on these strategies. To reduce the dependence of shipping companies on subsidy policies, it is recommended to improve the LSFO refining technology in the future. Expanding the implementation scope of LSFO subsidy policies will increase the utilization of LSFO by shipping companies. This study offers insights for governments to optimize the LSFO subsidy policy and shipping companies to choose sulfur oxides reduction approaches.